Third-quarter earnings at Riggs National Corp. in Washington are likely to be "materially affected" by fraud linked to an $11 million loan to a London borrower, the company said.

While it did not release any details of the alleged wrongdoing, $5.7 billion-asset Riggs said late Wednesday that it may need to take a provision for loan losses for the entire $11 million. The company added that it has more than enough capital - $841 million at the end of the second quarter - to cover its losses.

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